C1 - ME

Economics

is a social science that studies the production, distribution, and consumption

of products and services, as well as the resource allocation decisions made by people,

corporations, governments, and nations.

Social

Economics is a branch of _______ science

Social science

concerned with human society and an individual's role within it ; deals with uncontrolled variables.

Efficiency

ability to produce the most with the least amount of input. Along with money, other factors such as labor, raw materials, and time that a company needs to manufacture a specific good are also referred to as input. In contrast, output refers to the outcome or finished item of a production.

Effectiveness

can be attained by getting the desired outcome.

Scarcity

condition in which people's goals and needs are not met due to a lack of

resources. The law of scarcity states that resources are finite for a man's endless demands.

Scarcity is one of the primary reasons for the existence of economics, recognizing that

resources such as time, labor, and so on are finite and must be used wisely.

Shortage

a temporary condition where the demand on a certain commodity or service

cannot be met by current supply ; can be resolved by increasing production of goods or training more people to produce a service.

Opportunity cost

is the cost we forgo to get something. The cost of what you acquire is the worth of what is sacrificed to obtain it.

Production possibilities frontier

represents points at which an economy is most efficiently producing its goods and services

Rational Behavior

Refers to a decision-making process that is based on making choices that result in the

optimal level of benefit or utility for an individual.

utility

defined as a person's pleasure, happiness, or contentment.

Marginal Analysis

is the process of examining the costs and benefits of an event or activity, which helps with financial planning for companies and individuals ; results of the analysis reveal if an activity, development, or new addition is beneficial to the company's operations.

Marginal

it means additional, change in, or add in.

microeconomics. , macroeconomics

branches of economics

Microeconomics

concerned with how individuals and firms make decisions and the implications of those actions. It is frequently concerned with how a specific company or individual may make the most use of its resources ; concerned with issues such as customer behavior, production costs, and others that affect an individual organization, company, or even an individual person.

Macroeconomics

studies the economy's aggregate behavior, which encompasses the activities made by all individuals and firms to create a specific level of economic performance as a whole ; considers all enterprises and other factors of total national income,

Positive economics

looks on how the economy works. These are statements that are based on facts and are not influenced by values or opinion of other people.

Normative economics

focuses on what should be. It is often influenced by value judgments, depending on the circumstance.

Basic Circular Flow

This diagram shows the interdependence of two entities in the economy: households and firms (business sector).

land , labor , capital , entrepreneurship

4 factos in the market